PHP 5.2.7, which was released last Thursday (4 December), has a bug that prevents “magic quotes” from working. If you rely on magic quotes, do not install PHP 5.2.7.
Either revert to PHP 5.2.6 or wait until a fix is released. The bug has been fixed in the “snapshot” version of PHP, which can be obtained at http://snaps.php.net/
If you turn magic quotes off in PHP—which you should—you won’t be affected by this bug. It serves as a reminder that magic quotes are due to be removed in PHP 6. Magic quotes were originally introduced to make life “easier” for inexperienced developers by automatically inserting a backslash in front of single and double quotes in user input to prevent problems with database insertion. However, they have proved more trouble than they’re worth. Instead of magic quotes, you should use dedicated functions, such as mysql_real_escape_string(), or prepared statements with MySQLi or PDO to handle quotes and other special characters and protect your database from SQL injection attacks.